Keywords Studios PLC (LON:KWS) has entered the Australian market after the video game services firm unveiled its acquisition of a controlling stake in Melbourne-based group Tantalus Media.
The AIM-listed firm said it has acquired an 85% stake in Tantalus for up to US$46.8mln, an investment it says will further its strategy of becoming the “’go to’ technical and creative services platform for the global video games industry”.
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The acquisition will consist of an initial payment of US$30.6mln, US$18.4mln of which is in cash and US$12.2mln in new shares, with an additional US$16.2mln to be paid in a mixture of cash and shares based on performance targets for Tantalus over the next two years.
Keywords added that Tantalus boss Tom Crago will work with the firm to drive its expansion in the region, both organically and through what it said was “a healthy pipeline of acquisition opportunities”.
"Tantalus brings 27 years of experience of video game development in Australia for some of the largest global publishers and leading titles. The talented team, led by Tom Crago and supported by an experienced management team, has an impressive track record of development work on major franchises including Age of Empires, Sonic Mania, The Legend of Zelda, Mass Effect, Cars and Cities: Skylines”, Keywords joint interim chief executive Jon Hauck said in a statement.
"We are delighted to welcome Tantalus to the Keywords Studios family. As our first investment in Australia, we are very excited to work with Tom and his talented team who will bring invaluable expertise and market knowledge as we expand our presence in this attractive and growing region," he added.
Shares in Keywords rose 1.6% to 2,364p in early trading on Thursday.